DES MOINES, Iowa– State Treasurer Michael Fitzgerald announced today that the College Savings Iowa 529 Plan, has reduced its asset-based expenses. “This means more money stays in your account where it belongs,” said Treasurer Fitzgerald.
The cost reductions, effective July 1, 2009, will bring the annual asset-based fees of the plan’s 13 Vanguard investment options down from 0.52% to 0.50% (or $5 per $1,000 invested annually). This marks the second time in three years that College Savings Iowa has provided cost savings to investors. In September 2007, College Savings Iowa reduced expense ratios by 16% across its entire lineup.
“As we all know, every penny counts these days. The plan’s new lower costs will enable investors to put more of their investment returns toward the right place: their children’s education,” Treasurer Fitzgerald said. “College Saving Iowa continues to share the benefits of its growth by lowering expenses, which is a testament to the commitment of the Plan to deliver well-managed college savings investments at low cost to Iowans.”
In June, Savingforcollege.com awarded College Savings Iowa a “5-Cap Rating” for in-state residents based on the plan’s flexibility, appealing investments, and additional benefits such as generous state tax incentives. In March, College Savings Iowa was ranked among the top five 529 plans in the nation by Consumer Reports Money Advisor, which considered fee structure, investment strategy, and recent market performance in determining its rating.
College Savings Iowa is designed to provide families a tax-advantaged way to save money for their children’s higher education. Parents, grandparents, and others can invest in College Savings Iowa on behalf of a child. Iowa taxpayers can deduct up to $2,800 from their 2009 state taxable income and there are no income or residency restrictions. The money grows federal and state-tax deferred and is exempt from state and federal taxes if used to pay for qualified education expenses. Participants in College Savings Iowa can also take advantage of Upromise®, which enables families to earn cash rewards from their everyday spending.***
For an enrollment kit or more information about College Savings Iowa, call 888-672-9116 or visit www.collegesavingsiowa.com.
Vanguard, headquartered in Valley Forge, Pennsylvania, is one of the nation’s largest mutual fund firms and a leading provider of 529 college savings plans. Vanguard manages more than $1.1 trillion in U.S. mutual fund assets, including nearly $22 billion in 529 plan assets invested in 24 plans in 23 states. Vanguard offers more than 150 funds to U.S. investors and more than 50 additional funds in non-U.S. markets. For more information, visit www.vanguard.com
*** Upromise is an optional service offered by Upromise, Inc., is separate from College Savings Iowa 529 Plan (Plan), and is not affiliated with the State of Iowa. Specific terms and conditions apply. Participating companies, contribution levels, terms and conditions subject to change without notice. Transfers subject to $25 minimum.
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